Energy stocks have had a volatile year so far and continue to do so with the U.S. Presidential Elections being concluded this week. Energy companies in general have had one hell of a ride in the stock market in 2020. The COVID-19 pandemic disrupted most energy supply chains and even caused crude oil prices to drop to the negatives at one point. Also, with the U.S. elections coming to an end this week, the outcome of a Republican or Democrat President will affect the energy industry’s future.
More crucially is the Senate race as new policies such as the Green New Deal legislation can only be made if Democrats win the Senate. Investors of renewable energy stocks are nervous right now as a Republican-controlled Senate is becoming a reality. This is because Republicans are generally more inclined to supporting traditional fuels. This has caused several renewable energy stocks such as Renewable Energy Group (REGI Stock Report) and Bloom Energy (BE Stock Report) to be down 5.65% and 4.96% respectively yesterday.
Now things do look bleak for the renewable energy industry. However, you must remember that there is real momentum to shift our global energy needs to renewables. The implications of climate change have already caused one of the worst wildfires in California in October. Energy giants like Shell (RDS.A Stock Report) are already diversifying to renewables. With 7.8 billion people in the world right now, we are highly dependent on the energy industry. For the industry to meet this energy demand, we will need to shift to renewables. My take is that the renewable energy industry is here to stay and will continue to grow despite the shortcomings in 2020. Here are 3 top energy stocks that you could pay attention too for long term gains.
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NextEra (NEE Stock Report) is the world’s largest generator of wind and solar renewable energy. This is a remarkable feat to accomplish and the company does it with its impressive energy portfolio. The company has about 45,900 megawatts of generating capacity and has about 14,000 employees throughout the U.S. and Canada. It is also the largest electric utility holding company by market capitalization. The company has enjoyed a 67% increase in share price since the March lows.
In the company’s third-quarter fiscal posted in October, NextEra posted a net income of $1.229 billion which reflected a 39% increase year-over-year. The company also reported earnings per share of $2.50. Both its subsidiaries Florida Power & Light (FPL) and Gulf Power also reported substantial results. All of FPL’s major capital initiatives which include one of the largest solar expansions in the U.S. remain on track. FPL currently serves 5.1 million customer accounts in Florida and provides affordable power for its customers.
In addition to that, the company has also a 100% interest in a 100-megawatt solar-plus-storage project for a total of $1.3 billion. The company’s commitment to renewables is truly awe-inspiring. If its track record were to be any indication, the company has already invested nearly $90 billion in clean energy infrastructure. With that, it is no surprise that in the last 15 years, the company has consistently grown its adjusted earnings per share, reporting a compound annual growth rate of nearly 8.5%. Will NEE stocks continue to show impressive growth in the years to come?Best Renewable Energy Stocks to Buy [Or sell] in 2020: Enphase Energy
Another darling of the renewable energy industry is Enphase Energy (ENPH Stock Report). The company specializes in global energy management technology and is the world’s leading supplier of micro inverter-based solar-plus-storage systems. To date, the company has enjoyed a staggering 261% increase in share price, currently valued at $106.19. The company has been at the forefront of the solar industry and has enjoyed a few upsurges recently.
With every poll that indicated a Democratic lead with Joe Biden’s plans to make America a carbon-free nation by 2034, Enphase has enjoyed huge gains. With Joe Biden set to win the elections this week, it does position Enphase to help make Joe Biden’s plans a reality. The company reported a revenue of $178.5 million in its third-quarter fiscal posted in October. It also reported diluted earnings per share of $0.28.
Enphase had also announced a strategic partnership with Sonnenstromfabrik in August, which is one of Europe’s most modern manufacturers of solar modules. The two companies plan to develop the first high-efficiency Enphase Energized AC module (ACM). This module utilizes Enphase IQ 7+ microinverters and will be a huge entry for Enphase into the European residential solar market. With so many good things happening to Enphase, it is no surprise why ENPH stocks are on this list of energy stocks to watch.
[Read More] 3 Top Gold Stocks To Watch In November 2020Best Renewable Energy Stocks to Buy [Or sell] in 2020: Plug Power
Renewable energy company Plug Power (PLUG Stock Report) has been riding on highs recently. Year-to-date, the company has seen a 412% increase in share price and is currently at $16.61 per share. The company manufactures zero-emission fuel cell products that help generate electricity. The company focuses on economically viable and sustainable power solutions. They have a wide range of customers from automotive to data centers.
In its latest financial posting in August, the company delivered gross billings of $72.4 million during the COVID-19 pandemic. This reflected in a 24% growth year-over-year. The company has also reaffirmed its third-quarter guidance for a gross billing of $110 million to $115 million. This is given how renewables have been getting a larger pie of the energy market share. The company has also projected its financial targets in 2024 to achieve $1.2 billion in revenue. Is this a realistic figure for Plug Power?
The company has recently completed its acquisition of United Hydrogen and Giner ELX as part of the company’s green hydrogen strategy. Plug Power has also engaged with multiple locations to build a center-of-excellence fuel cell and electrolyzer stack Gigafactory. To top things up, the company is also looking at ongoing expansion in Europe to build a substantial presence for its core market. This includes material handling and expanding into on-road applications. With that in mind, should investors be on the lookout for PLUG stocks?